Broomer's Blog

From the monthly archives: February 2016

We are pleased to present below all posts archived in 'February 2016'. If you still can't find what you are looking for, try using the search box.

Knowing What to Wear

The content of Mark Zuckerberg’s wardrobe made headlines earlier this year http://bit.ly/1Rzr2Zb and while I think it falling well short of psychopathic tendencies, I confess that I do find it, well, a bit weird. However, just as it is easy to dress in the morning with little choice, sometimes, severely restricting your investment universe can make life much simpler without making much impact on the return potential.

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If it Walks like a Duck and Swims like a Duck, then it’s Probably a Quacker

The key European regulation organisation, ESMA, has recently been looking into the issue of closet trackers or index huggers (I prefer the term quasi-tracker, or quackers for short). The implication is that some asset managers are charging active fees for what are in essence tracker funds. 

Our focus is on funds that meet investor outcomes, funds that assess risk versus a volatile benchmark don’t really meet these needs. As a result, Square Mile would rarely look at a quacker type fund, much less recommend one. However, I would not be surprised if some funds run by certain groups end up been accused of being closet trackers. Frankly, we haven’t investigated the issue and we focus our efforts on identifying good funds, not bad ones. 

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